David Miliband: It is very odd to define increased spending as cuts. The increased spending over the next period will be used in the areas of greatest need. Moreover, it is right that we do not use defence attaches for non-defence work, as they are specialists and should work on defence matters. The hon. Gentleman accuses me of creative accounting, or at least creative number work, but he may be interested to know that Germany has 226 posts, the US 262 and France 275. The UK holds a diplomatic network of outstandingly qualified individuals who work closely with DFID and British Council staffs. They provide a network that, in times of crisis, has shown itself to be more than adequate for the country's needs. I am sure that he will seek to criticise the Government about many things, but I believe that we should all be proud of the nature of our global network and its deployment around the world.

Kim Howells: I was surprised to read Sir Hilary's statement, because in fact there have been some very substantial achievements in and around Basra; one has only to think, for example, of some of the projects run by the Army down there. There are huge new date plantations, employing 4,000 people. When our rebuilding of parts of the electricity and water infrastructure finishes very soon, there will be additional electricity and drinking water for the first time for 1,000,000 people.
	There have been achievements. However, the hon. Gentleman is right to raise the issue of the lack of preparedness after the invasion in respect of understanding what was required in rebuilding the country and offering people services that made their lives different from how they had been during the days of Saddam Hussein.

Katy Clark: As the right hon. Gentleman will be aware, delays have reduced significantly since Network Rail took over those responsibilities, which contrasts starkly with the period when his party was in power. We need to look at fragmentation and at whether, particularly in a period when there will be huge change in the railways as significant investment is made over the coming years, the structures that exist and the levels of co-operation are such that they will ensure that the work can be carried out with the least possible inconvenience to the public.
	Labour Members would like to see further significant increases in railway capacity. There has already been a more than 40 per cent. increase in those using the railways. Clearly, such increases will come about only as a result of significant further investment in infrastructure and rolling stock, so this is a timely debate. The current set- up, whereby renewal work for the significant upgrading of the railways is undertaken by a wide range of private contractors, is not likely to ensure that the work is carried out in a way that provides either best value for the taxpayer or the best possible service to the public.

Norman Baker: Does the hon. Lady accept that although the Christmas and new year period was quieter in terms of numbers, it is the time when people who are not regular customers use the railways? Their experience of the railways was therefore a terrible one, and the business will not grow if people who use the railways once a year find experience such things.

Katy Clark: I agree. As someone who used the railways over the past few weeks, I am aware of what he describes. People will take a number of factors into account when using the railways, one of which will be fares. We must accept that engineering work will need to be carried out at some point, that whenever it takes place it will cause some form of inconvenience to passengers and that this is about trying to ensure that inconvenience is minimised.
	I hope that the House will agree that the railways will provide an important part of our transport future. Compared with many other forms of transport they are very environmentally friendly, and we must invest more in technologies to ensure that they become even more carbon friendly. We must do far more to invest to make rail the preferred mode of domestic traffic within Britain, because the reality is that not only are the railways often a slower and, as the hon. Member for Lewes (Norman Baker) has said, on occasion, although not always, more unreliable mode of transport, they are often a more expensive one. Indeed, it is often cheaper to get a package flight to the Caribbean than to get a first-class flexible ticket to Scotland.
	Passengers will take a range of factors into account when considering whether to choose railways as their mode of transport. We must consider whether the structure of the railways is the most effective way of ensuring that passengers receive the best possible service, and I hope that the House can unite around that. I am grateful to the Secretary of State for her undertaking to investigate the events of the past few weeks, and I hope that the Opposition will consider the outcome of the investigations as carefully as they have considered the problems.

Jeremy Wright: It is almost always a pleasure to hear the name of my constituency on the national media, but that was not the case over the Christmas and new year period. All the adjectives that hon. Members have used to describe what happened during that period are justified and I shall not repeat them all.
	What occurred was obviously unacceptable. It was a chronic failure of management and, to be fair to Network Rail, it has accepted that. We do not need to argue about whether what went wrong over Christmas and new year was or was not a bad failure of management by Network Rail: it admits that. The question is in what way it failed and whether we can ensure that it does not fail again.
	I agree with the hon. Member for Ellesmere Port and Neston (Andrew Miller), who is sadly no longer in his place, that the project was very big, and it is inevitable that things go wrong in such projects. However, it is not inevitable that things should go wrong to such an extent, nor that it should take so long to put them right. That is what we need to focus on when we discuss what happened.
	I also agree with the hon. Members for Stroud (Mr. Drew) and for Lewes (Norman Baker) that the explanation that Network Rail has given is, in large part, that it simply did not have enough skilled labour to get the job done, not just around Rugby but elsewhere on the network. I understand that, and it is a reasonable point to make, but we have to ask at what point that became apparent to Network Rail, and therefore when should it have decided to do something about it. When we consider what we definitely know, it is apparent that Network Rail management knew—certainly by 21 December, and probably a long time before—that there would be significant problems in the area around Rugby. However, it is not apparent what, if anything, management decided to do about it. Those are the relevant questions not only for the regulator to address when the inquiry begins, but ultimately for the Government and the Secretary of State to address.
	On 21 December, when Network Rail realised that the engineering work around Rugby was due to run into new year's eve, what did it do? What action did it take? What did it do when it realised that the work would overrun beyond new year's eve? The management has given me and others the explanation that when they talked to the limited supply of skilled engineers and electricians who had the knowledge and expertise to deal with the overhead lines—which is what needed to be done—they all said that they had made other plans for the new year celebrations. One can understand that to an extent, although it should have been anticipated. However, the line did not reopen until 4 January. What went on in the Network Rail management offices that meant that they did not make adequate provision to ensure that the line opened almost immediately after the new year? One has to wonder whether managers made a clear calculation that the works would inevitably overrun by more than was acceptable and that the company would be fined, but that it would be easier and cheaper to pay the fine than to do what was necessary to get the work done on time. That is what the Office of the Rail Regulator will investigate, and we all—especially the residents of Rugby—look forward to the conclusions of that investigation. It seems to me that we have to ask such questions.
	Another question that should fairly be asked of Network Rail is about the information that it gave to the train operating companies. Virgin Trains suffered hugely as a result of the overrun and was not given adequate information at adequate times. After the first announcement of the engineering overrun, the Virgin Trains website said that although people could not travel on new year's eve and new year's day, for which the company was sorry, their tickets would be valid on Wednesday and Thursday. It quickly became apparent that rail travel on Wednesday and Thursday was not going to happen, either. That made Virgin Trains look foolish. The company would have made that announcement based on information that it was given by Network Rail. If that information was wrong, we need to understand why it was wrong and why Network Rail did not give out accurate information about when it realistically expected the line to reopen.
	I have said that normally it is a pleasure to hear about my constituency in the national media or anywhere else, because it is an attractive place to visit. I am sorry to say that no Member of this House—or anyone else—has been able to do so effectively for a long time. My interest as the Member of Parliament for Rugby is not only in the level of disruption in and around Rugby and its effect on Rugby's reputation, but in what the disruption and its consequences mean for the people whom I represent. One of the problems that the level of disruption throws up is that those who live in Rugby or travel from Rugby station see an awful lot of down sides in the disruption caused by the upgrading of the west coast main line. They cannot rely, as perhaps others elsewhere in the country can, on the hopeful prospect that one day it will all be wonderful and that they will be able to get up and down the country easily and much more quickly. For those who live in or travel from Rugby, that is not necessarily the case.
	The Under-Secretary of State for Transport, the hon. Member for Glasgow, South (Mr. Harris), knows my points, because I have made them to him before. He will be relieved to hear that I shall not go through all the detail again. He understands my case. The problem is that the overruns in engineering work and disruption affect people in Rugby as much, if not more so, as everyone else. However, those people do not have the prospect of a better service when it is all done.
	The 2009 timetable shows that not only will there arguably be a less good service down to London and back at peak times, but the services from Rugby to the north-west and Scotland—hon. Members have mentioned them in particular—will be noticeably worse. There is a tension, if not a conflict, that we must resolve. If we are to develop a fast rail line, as the west coast main line will be, of course it is right that there will be a tension between getting people from one end to the other as quickly as possible while simultaneously stopping the train at all the places where people wish to get on and off. I understand that. However, it does not seem that it can possibly be right that the improvements to the west coast main line could so effectively bypass the people of Rugby, who have suffered so much in making them happen.
	We have seen all the work on the track and the new station being put up, but there is little point in those improvements for those who live in or travel from Rugby if all they achieve is the quicker passage of other people through their town. People in Rugby want to be able to get on the train at Rugby and to go to the places to which they want to go.

Peter Soulsby: Indeed. I recognise that such an alternative was put forward from the Liberal Front Bench; I was referring specifically to those on the Conservative Front Bench, who consistently failed to identify such an alternative, despite being challenged by Labour and Liberal Members. It is the Conservatives' motion that we are debating and it is they whom I criticise for failing to provide any credible alternatives, to go alongside the criticisms that they have levelled.
	In general, Network Rail has delivered. It faces an enormous challenge in meeting the Government's ambitious programme of renewal for our railway infrastructure. We are undoubtedly at a time when rail is again seen as a mode of transport for the future. We were all heartened by the enthusiasm generated by the completion of St. Pancras and the linking of High Speed 1 to the station, as well as by the potential for the benefits of that to be fully exploited. Many of us also feel considerable frustration that the Government cannot as yet commit to further high speed lines throughout the UK, to take advantage of the enthusiasm generated by St. Pancras and the linking of High Speed 1 to it.
	That said, there is now undoubtedly not only a challenge, presented by increased usage of the railways, but a considerable expectation that the improved services will be delivered, that the infrastructure will continue to be improved in order to enable that to happen and that Network Rail is the only credible way of ensuring that that takes place. Network Rail has much to be proud of, in how it has delivered for the passenger and on behalf of the people of Britain, and how it responded to the Government's agenda. However, it undoubtedly also has much to learn from the events of recent weeks. One can only hope that the investigation that the Government have instigated into those events will enable them to learn for the future and to deliver, as I hope we all expect they will do, in the months and year to come.

John Pugh: I want to make a brief contribution. Oddly, I want to put in a small word of praise for Network Rail—I say "oddly", because there are plenty of negatives that I could mention, such as delays and costs on the west coast main line, as well as the lack of interest in Lime Street station, Liverpool's main rail terminus, in the city's capital of culture year. I could also mention the muted support for the Merseyside dock expansion and the unforgivable opposition to the vertical integration of Merseyrail, as well as the extraordinary salaries paid to Network Rail's top executives. I want to park all that and be positive, although not simply because Network Rail is currently spending £6 million on Southport railway station.
	As a former member of the Select Committee on Transport, I recall the demise of Railtrack and the ensuring chaos. For years after that, all we got was retrenchment and battening down the hatches. Anyone who approached Network Rail in those days with a suggestion for rail would get a lecture about bringing down costs and running existing track efficiently—in fact, about mere coping. In those days, a business case for rail expansion was viewed as a contradiction in terms—an oxymoron, something best left to the dreams of anoraks. Now, however, as a result of the rail utilisation strategies—I believe I am the first to mention them—Network Rail has moved. It has done so ever so tentatively, but it has moved, and on to the front foot. It seems to recognise that small-scale improvements and small adjustments to networks can add functionality, capacity and utility to the rail system, bringing with them passengers, profitability and environmental and economic gain. It will probably cost less than the small change from Crossrail—I welcome the fact some of my fellow victims from Crossrail are in their places today—and will in all probability deliver huge gains for the region.
	In Lancashire, for example, the rail utilisation strategy revealed desperately poor connectivity between the Preston city region and Merseyside, yet lines from both conurbations arrive in the modest town of Burscough, which has separate stations, unlinked by rail, half a mile apart, severed by Beeching and simply missing a curve. Were this in London, such connectivity would have been delivered decades ago, but because it is in the north-west, it is a struggle to get it done. At least now, however, Network Rail has conceded that there may be a case for such improvements: that is progress, that is new, that is to be applauded. Real applause will follow if the Network Rail, the operators and the transport authorities follow up the words with the money and actually do something.
	I want it put on record that Network Rail is slightly, if tentatively, on the front foot. It is thinking ahead a little and talking of growing the railway, so it is not all bad news.

Nicholas Winterton: Of course, I agree with my very good and honourable Friend. He is making the same point as our hon. Friend the Member for Rugby and Kenilworth. Rugby is also going to have fewer services because many more passenger trains are going to sweep through Rugby, sweep through Lichfield, sweep through Nuneaton and sweep through Macclesfield on the way from Manchester to London. That is letting down the people who are based in important profit centres en route and it is not offering the best or best value-for-money use of our rail infrastructure. The Minister must have an influence over these matters. It is no good saying that it is all up to Arriva Trains or Virgin Rail. By the way, I note that Virgin is very unhappy about losing the franchise in the north-west. Personally, I deeply regret that it has, because Virgin was extremely efficient and provided an excellent service.
	Network Rail not only has to provide the signalling and track infrastructure necessary to get trains from A to B and B to C and so forth, as it also has to utilise the available land and ensure, in co-operation with local government, that there is adequate car parking close to or in the proximity of major stations such as that in Macclesfield. I have sought to put Network Rail in touch with the borough council and the county council in Macclesfield in order to treble the parking spaces. If we are to get people out of their cars, as the Government say they want to, not just for long journeys like Macclesfield to London but also for journeys like Macclesfield into Manchester, having more parking spaces will become even more important in the future.
	Both the Government and the city of Manchester want to implement some form of toll or a congestion charge, but if there is no capacity on the railways, how are my constituents going to get to work in Manchester? The bus services are totally inadequate, so the only alternative to the car is the train, but if the trains are not running as a result of reduced services, all I can say is that it shows how the Government are not joined up at all. They are trying to achieve objectives, but in the process, they are dramatically undermining the ability to change travelling behaviour and get more people onto public transport. In my area of Cheshire, east Cheshire and Macclesfield, public transport is inadequate. Reducing the number of local trains will create even further difficulties.
	I shall be meeting the managing director of Arriva Trains in the next 10 days, so I hope that the Minister will take this issue seriously and not send another reply to my letters, saying merely that the fast trains are going to get the automatic right to the track and that local trains will be treated akin to second-class citizens. That is not the way to operate. Will the Minister take this matter seriously?
	Rail can answer, in a major way, some of the problems of getting to and from work, but unless we have the necessary number of trains and the necessary capacity on the track and on individual trains—which means longer platforms and more carriages on each train—we shall not be able to achieve the Government's objectives in respect of climate change and carbon dioxide emissions.
	I feel terribly strongly about this. I sometimes travel down by train, although I do not always do so, and I do not share the dislike of cars—almost a phobia—felt by the hon. Member for Lewes (Norman Baker). People in this country demand mobility, and cars can give it to them. In the countryside, by the way, four-by-fours are necessary.
	I ask the Minister please to respond to the genuine concern that is expressed about the way in which our rail services are organised. In an era in which the Prime Minister says that he wants a Government of all the talents, I am only surprised that he has not asked my right hon. Friend the Member for Wokingham to advise him on rail structure; but I really do want a constructive reply from the Minister. He is a decent guy and I like him. Can he come up with the answer to what has been asked in this debate?

Stephen Hammond: We have had an excellent debate. The stimulus for it was, of course, the overruns in track maintenance and disruption to thousands on the west coast main line and at Liverpool Street, but inevitably the speeches covered wider issues.
	My hon. Friend the Member for Rugby and Kenilworth (Jeremy Wright), in his lawyer-like manner, presented an excellent forensic analysis of the problems that have confronted his constituents. It was thought provoking and extremely well argued. We were also fortunate enough to hear from my right hon. Friend the Member for Wokingham (Mr. Redwood), who, in a truly memorable speech, gave a history lesson reminding us that British Rail was not the paragon of virtue that some seek to remember, and that nationalisation is no model for the running of a railway. He also reminded us of something that some may wish to forget: that the right hon. Member for Kingston upon Hull, East (Mr. Prescott) praised privatisation for increasing passenger traffic. He was, of course, right to point out the Network Rail is the creation of this Government. At the heart of his reasoning—which is why it was so correct—was the fact that Network Rail has £18 billion of debt guaranteed by the Government, and relies on the Government for its revenue subsidy.
	We also heard a well-argued and thought-provoking plea from my hon. Friend the Member for Macclesfield (Sir Nicholas Winterton) that his constituents should not be left behind in the development of high-speed services that might be introduced when the route from London to Manchester is speeded up.
	Along with others, I welcome the hon. Member for Lewes (Norman Baker) to his new role as Liberal Democrat spokesman. I was interested when the hon. Member for South Thanet (Dr. Ladyman) described his speech as "good". We always feel worried when that is said in case the next words are "and original", and we are told that the good bits were not original and the original bits were not good.
	The only part of the speech from the hon. Member for Lewes with which I strongly agreed was the part in which he said that the Government had not focused on capacity. The speech from his colleague, the hon. Member for Southport (Dr. Pugh), was succinct and positive. I wondered whether the positive element was caused by the fact that so much was being spent on capacity improvements at Southport, but I am sure it would be ungenerous of me to suggest that that was the only cause.
	We heard an interesting speech from the hon. Member for North Ayrshire and Arran (Ms Clark), who is not present now. She was honest enough to state that she favoured public ownership—not a sentiment that will necessarily endear her to her Front Bench or, indeed, guarantee her promotion. The hon. Member for Llanelli (Nia Griffith), who also seems to have disappeared, spoke of the lack of Sunday and holiday services. The hon. Member for Leicester, South (Sir Peter Soulsby)—who is present—expressed some disappointment with Network Rail, but complained that he had heard no alternative suggested from the Conservative Front Bench. I cannot remember too many alternatives coming from the Front Bench of his party when it was in opposition, but I can give him the glad tidings that we are undertaking a rail review. We are taking our time over it, and coming up with measured, costed proposals that he will be able to see later this year.
	The expansion of the debate beyond the issue of overruns is hardly surprising. Members recognise that the problems with Network Rail run far deeper than the shambles that we saw over the new year. The motion calls on the Government to take steps to make Network Rail more accountable and efficient, and that is only right. Even this "not me, guv" Government must accept that they created Network Rail, and that if Network Rail is failing they must correct it and take some responsibility.
	On 19 December, Passenger Focus expressed disappointment at Network Rail's indication that there would be overruns during the new year period. Before Christmas, Virgin Trains asked the Office of Rail Regulation to take enforcement action against the likely disruption over that period. In other words, the problems on the west coast main line and Liverpool Street did not come out of the blue; they were anticipated and expected. The question to which we have failed to receive any answer, and which must be answered by the Office of Rail Regulation inquiry, is "Why did Network Rail not act at that stage?" Why did it not reschedule lesser works so that thousands of people would not be disrupted and uncompensated?
	Time after time this afternoon we heard the Secretary of State say that we must wait for the review. The Government must accept that, in letters to Members, the management of Network Rail has already accepted a large part of the blame. One of the questions that the Minister might wish to answer is "When did the Secretary of State know of the likely problems?" Did she know before Christmas, and did she speak to Mr. Coucher then? If she did not—given the clear statement by Passenger Focus and others that there would be problems over the new year—she has been negligent.
	As we all know, what actually happened was exactly what had been predicted: work on the west coast main line was not finished on time. For commuters in the constituency of my hon. Friend the Member for Rugby and Kenilworth, however, that is not news. During the current financial year alone, they have experienced 150,000 hours of delay. Perhaps the Minister will answer the question that the Secretary of State chose not to answer: do the Government still believe that the west coast main line upgrade will be delivered by December 2008, and if not, when do they expect it to be delivered?
	Liverpool Street station was shut on 2 January following the overrun of a 10-day engineering project to replace a bridge. Andy Chivers, managing director of the National Express One franchise, rightly described that as a "major failure". He also declared that Network Rail had not delivered on assurances that it had given him before Christmas. The Minister might care to address the following questions. Why could Network Rail not predict the likely problems at Liverpool Street? If it did predict them, whom did it tell and what did the Department do about it? This was a failure of project management systems. Who was in charge? When did Mr. Coucher tell the Department? When did Mr. Coucher know, and when did Mr. Henderson, the engineering director, know? Whom did he tell, and when? When did the Secretary of State know, and what action did she take? The short answer to the second part of that question must be "none".
	If this were an isolated incident, we would be disappointed. We would be asking, as Passenger Focus has, "Where is the compensation for the passenger?" and "Has the industry understood the problems?" If it were an isolated incident, however, we would not be having this debate. The trouble is that for all the comments about learning lessons, it was not an isolated incident. Even as we stand here today, there are Network Rail overruns in Scotland. There are systemic problems with Network Rail that need to be addressed: its efficiency, its accountability, its priorities and the way in which it delivers services to passengers.
	What happened over the new year in 2008 was certainly not an isolated incident. The Government disbanded Railtrack, created and then disbanded the Strategic Rail Authority, and then created Network Rail. We were led to believe in a brave new world created by the Government: never again would there be an incident, never again would there be overruns, and never again would there be accidents. What nonsense! Network Rail has had a history of overruns and accidents. In the last two years alone, its record reads like a catalogue of mismanagement, inefficiency and incompetence. In March 2006 it was fined for failing to provide proper information to other TOCs. In September to October 2006 there were derailments at Waterloo, where the rail accident investigation branch catalogued a failure of reporting and fault management systems and supervision errors, and at Greyrigg. In March 2007, it was fined for overruns at Paddington.
	In July 2007, Network Rail was fined £2.5 million for failing to complete re-signalling at Portsmouth. At that point, the ORR concluded that Network Rail had failed adequately to evaluate and mitigate the risks associated with the project. That might sound rather familiar to constituents of my hon. Friend the Member for Rugby and Kenilworth, for that appears to be exactly what happened there over the new year. Far from learning any lessons, Network Rail seems to have failed to address those lessons.
	Mr. Coucher—following the lead of the Government, who seem to say, "It's not our fault, it is always someone else's"—has sought to blame his contractors. This is feeble at best and disingenuous at worst. It is feeble because these projects have long lead times, contractors need to procure supplies and TOCs need up to 15 months' notice. If that were so, the question we should be asking is whether the complete scheme was identified on time and agreed, and what interaction Network Rail was having with its contractors.
	It is feeble to blame the contractors, partly because only a bad workman blames his tools. It also implies a complete failure of oversight, of management supervision and of management. The accident report for Waterloo shows that failures have happened whether functions have been taken in-house or not.

Stephen Hammond: I am just coming to that point, but I agree with my hon. Friend the Member for Macclesfield. Network Rail is not properly accountable and it needs to be made so, but do not take our word for it. This morning, one could have read Tom Winsor's remark that
	"Network Rail is a company supposedly answerable to its stakeholders...they have no power."
	Lord Berkeley, a Labour peer, said:
	"I think it would be helpful to Network Rail and all the people that use the network if there were greater accountability".
	Network Rail's structure ensures that it is accountable only to itself. My hon. Friend the Member for Chipping Barnet has already highlighted the problem of fines and has said that she believes that the ORR might require extra powers. She is right.
	Where else should accountability for Network Rail lie? Should it lie with the non-executives, who awarded themselves a pay rise of 18 per cent. on average last year and are supposed to be holding the executive body to account? In yesteryear, the then, and hopefully soon to be again, Labour Opposition used to lecture us about fat cats. At least those privatised companies delivered. In the world of new Labour, a failure to speak out or to provide accountability earns you a self-awarded 18 per cent. pay increase. Causing disruption to thousands of people earns the chief executive £466,000 salary and £76,000 in bonus.
	The short answer is that Network Rail is not a private sector company but a public sector one. This Government created Network Rail. The Secretary of State today has sought to hide behind the ORR. It is typical of an exhausted Government, clamouring for any credit they can find but shirking any responsibility. The Secretary of State failed to answer the key questions today. When did she know? What action did she take? Increasingly, she is a Secretary of State out of touch with the needs of the travelling public. Network Rail is in danger of hitting the buffers.
	If, after the new year chaos, the travelling public and the TOCs view Network Rail as not fit for purpose, that is equally so of the Government and the Secretary of State. The Government have a responsibility to ensure that Network Rail works. It is a failure: the failure of the Government. The travelling public, who suffered fare increases of up to 14 percent and often travel in sub-human overcrowded trains, have a right to expect and deserve better.

Tom Harris: This has been a very good-humoured debate—at least the middle of it; the beginning and end of it have been less so.
	I will come back to my prepared comments, because first I want to make it clear that mistakes have been made and Network Rail has issued an apology. Passengers have paid the price for the mistakes made and that is unacceptable, as both sides of the House accept. The hon. Member for Wimbledon (Stephen Hammond) has said that Network Rail is a failing company. That speaks more to his wishful thinking than to the facts. Nothing would please the Conservative party more than to have Network Rail painted as the same basket case as Railtrack. It is simply not the case.
	 [Official Report, 23 January 2008; Vol. 470, c. 16MC.]
	Network Rail came to the rescue of Railtrack. When Railtrack was drowning in its own inefficiencies, and costs for the updating of the west coast main line had gone to above £20 billion with no prospect of the project finishing, it was Network Rail that came in and rescued the project, which is now delivering at a cost of £8 billion. It was Network Rail that helped push performance up by more than 10 per cent. as measured by the industry standard public performance measure. It is the outstanding engineering experience of Network Rail that is leading renewal and expansion of the rail network at Birmingham New Street, at Reading, on the west coast main line and through Thameslink.
	My hon. Friend the Member for North Ayrshire and Arran (Ms Clark) spoke about her concerns about the involvement of private industry. I do not agree with her. I do not think that the involvement of the private sector in the rail industry is a bad thing. I think that it has brought innovation and efficiencies to the rail industry. She is a solid supporter of the railways and I take seriously what she says. However, in some areas we will have to disagree. I do agree with her that passengers must get the best possible service. I have said on a number of occasions that the railways are not run for politicians or for the industry itself; they are run for passengers.
	The hon. Member for Rugby and Kenilworth (Jeremy Wright), in a positive and emollient speech, asked Ministers to address Network Rail's failings. He might be interested to know that, on 12 November last year, the hon. Member for Chipping Barnet (Mrs. Villiers) told  The Daily Telegraph:
	"The fat controller is still there in Whitehall—
	of all the ministerial team, I think she was probably referring to me. She continued:
	"It is a real concern that Ruth Kelly (the Transport Secretary) has more control over the industry than the days when people were eating British Rail pork pies."
	If that is a genuine concern of the Opposition Front Bench, the hon. Gentleman has to accept that that comment was made in a pejorative sense. Presumably the hon. Lady does not believe that Government involvement in the industry is a good thing, yet here we have the transport Whip, the hon. Member for Rugby and Kenilworth, telling Ministers that they must micro-manage Network Rail.

Tom Harris: I am sorry but I am not giving way, because I have a limited amount of time.
	The hon. Member for Rugby and Kenilworth made some other comments about services to his constituency. He might be interested to know that, at Rugby, there will be a trebling of services from Rugby to Birmingham, Coventry and Northampton. There will be an accelerated service to London, and a new semi-fast service to Crewe giving new connections to Liverpool, Manchester and Preston. There will be a major increase in capacity in all Rugby services. The upgrade of the west coast main line will be good news for all his constituents.
	My hon. Friend the Member for Llanelli (Nia Griffith) talked about Sunday services and she is right; we want to move to a seven-day service. The right hon. Member for Wokingham (Mr. Redwood) gave a speech that I thoroughly enjoyed. There were some things he said with which I agreed; I will not go into the detail at the moment. However, he has the dubious distinction of being Railtrack's last and proudest defender. He said that there was no difference between Network Rail and Railtrack but that he generally prefers Railtrack. It says something about the self-delusion of members of the Conservative Cabinet at that time that even now, after what has happened to Railtrack, they still believe that Railtrack was not an ignominious failure.
	My hon. Friend the Member for Leicester, South (Sir Peter Soulsby) talked about high-speed lines. He has mentioned the issue before, and he knows that it is still under review by the Government, and we will make further announcements on it in years to come.
	The hon. Member for Southport (Dr. Pugh) made some praiseworthy remarks about Network Rail. They were, I felt, less than enthusiastic, but he was welcoming of the utilisation strategies produced by it.
	The hon. Member for Macclesfield (Sir Nicholas Winterton) talked about the need for car parking at Macclesfield. He also talked about the Government seeking modal shift in respect of the importance of getting people out of their cars and on to the railways. He can search the Library and the online version of  Hansard as much as he likes, but he will not find any comment by me encouraging—or dictating to—people to get out of their cars. It is the Government's intention to provide people with informed choices, and to allow them to make decisions about which modes to use. The fact that 40 per cent. more people are using the railways today than 10 years ago says a great deal about the stewardship of the railways under this Government.
	I agree with something that the hon. Member for Chipping Barnet said. There would indeed be fewer network rail possession overruns under a Conservative Government, and that would be for one very obvious reason: there would be far fewer engineering works. The west coast main line upgrade, Thameslink, Crossrail, Reading, Birmingham New Street—funding for all those projects, which are so vital for the expansion of the railway, simply would not be guaranteed under a Conservative Government.
	The Conservatives always like to dispute Labour claims that they are planning to cut public expenditure. When it comes to the railways, however, we already have a cast-iron guarantee that investment would be reduced, and reduced significantly. The hon. Member for Chipping Barnet stated on her own website:
	"The worrying thing is that the franchise payments the government has agreed with rail companies mean these increases are likely to continue well into the future."
	On 17 July, she stated in the House—wrongly, of course—that the Department for Transport set the franchise payments for the train operating companies and that those payments were solely responsible for increased fares. There we have Tory transport policy to date: train companies do not like paying premiums. I wonder how the hon. Lady came to that conclusion—perhaps she commissioned research from the university of the blindingly obvious? Of course they would prefer not to pay premiums, but if a train operating company is making large profits on a franchise given to it by the Government, why should not some of the profits go back into the transport budget? That is what is happening. However, like her predecessor on the Front Bench, the hon. Member for Epsom and Ewell (Chris Grayling), the hon. Lady wants TOCs to be given subsidy only from the public purse, regardless of how profitable a franchise might be. The disappearance of those premiums would present a net loss to the rail budget, so where would the cuts fall?
	Let us turn to the Opposition motion, which states that Network Rail should be held more accountable—more accountable than what? Should it be more accountable than its predecessor, Railtrack, perhaps? How accountable was that organisation, set up by a failing Tory Government to oversee the decline of the railways—an organisation whose first priority was not maintaining the railways in a safe manner, but providing dividends to its shareholders? The hon. Lady waxes lyrical about the injustices of poor TOCs having to pay some of the profits back into the rail budget, but I have yet to hear her complain about Railtrack shareholders receiving their dividends while track maintenance was ignored and lives were put at risk.
	How should Network Rail be held more accountable, according to the hon. Lady? That point was ably made by my hon. Friend the Member for Leicester, South. Her remarks earlier today shed no light on the matter. It was up to Eddie Mair on last week's BBC Radio 4 "PM" programme to elicit some details, and we are all grateful to him for that. Eddie Mair asked, "How would you fix what you clearly believe are structural problems in the railways?" The hon. Lady replied, "Well, we're looking at a range of options to ensure that Network Rail does become more accountable to its customers." Eddie Mair then asked, "What are the options for making Network Rail more accountable?" The hon. Lady said, "Well, we're looking at a range of options at the moment. We're carrying out a rail review, which we will be publishing shortly." Eddie Mair's next question was, "But can you give us no further ideas?" The hon. Lady responded, "There are a range of options we are looking at, but I can't give you details as yet, but they will be published shortly."
	The hon. Member for Wimbledon said in his summing up that the Conservative rail policy will be published later this year. I think he also said that last year—he said then that it would be published later in the year. So, that is clear then: the Conservative party regrets to announce the late arrival of its railways policy and any inconvenience that that may cause.
	We have an expanding railway. We have record passenger numbers—totalling more than 1 billion in the past three years. We have cheaper regulated fares in this country than we had 10 years ago. We have the youngest train fleet in Europe. For the first time in 50 years, we have a Government which is actually able to plan for expansion in our railways. A Conservative party which created Railtrack and starved the rail industry of vital investment is in no position to give lessons to this Government.
	 Question put, That the original words stand part of the Question:—
	 The House proceeded to a Division.

Mark Pritchard: I am glad to hear that the Secretary of State shares the values that he mentioned, but why does he not share my concerns, those of my hon. Friend the Member for Salisbury (Robert Key), and those set out in a letter to me from the Bishop of Hereford today, which concern the fact that all faith communities will be affected by the withdrawal of equivalent or lower qualification funding, including imams, rabbis and clergymen from all the Christian churches of this nation? Is that what he calls upskilling, and is it, in his view, helpful to community cohesion?

John Denham: One of the reasons for holding a consultation is to ensure that Ministers understand the consequences. That is why one consults. An initial idea is always put forward, so that we can find out the detailed reaction. I notice that the hon. Gentleman did not make the obvious point that I would make: today, the choices available to the House and to people who want to enter higher education are vastly greater than they were when the Conservatives were in power. The Opposition have still not acknowledged the damage that they did to higher education in their time in office.
	The Government have asked the HEFCE to advise us on how to distribute £100 million of core teaching grant over three years. That money will not be lost to the system. It will be redirected to fund more university places for first-time learners, or learners progressing to a higher level of qualification. Up to 20,000 full-time equivalent students—and so, in reality, far more students, some of them studying part time—will have the chance to start a first degree or higher level course in the first three years. That sets the right priority for individual opportunity, and for the country.
	We have to develop the skills of our people to the fullest possible extent, carry out world-class research and scholarship, and apply knowledge and skills to create an innovative and competitive economy. As the noble Lord Leitch made clear, to be in the premier league for skills, our country will need 40 per cent. of working-age adults to have a level 4 qualification by 2020. Today, 20 million working-age adults do not have a degree-level qualification. An extra 5 million people will need to go through university by 2020 if we are to be even on the edge of the premier league for world-class skills. Lord Leitch not only set out the challenge, but was clear about the priorities for funding: the higher the qualification, the greater the level of individual or employer contribution. He argued that that was fair, given the benefits for individuals and employers who gain higher-level skills. Those principles are being applied across the adult education system.
	We took the difficult decision to introduce variable fees. When we face a choice, as we do today, both economic success and economic justice argue that public money should go first to those who have never had the chance of higher education. The choice is between second chances for those who have already enjoyed substantial public funding for their degree, and first chances for those who never have.

Gordon Marsden: My right hon. Friend rightly reminded the House of the emphasis that the Government have put on upskilling adults. The list of those who will be exempted is formidable and impressive, but will he ask the HEFCE to consider that there is an issue, particularly in our more fluid economy, in relation to self-employed people who may wish to take a further degree? They will not automatically be covered by the exemptions that my right hon. Friend described.

Stephen Williams: I thank the Secretary of State for what he thinks is a clarification, and for welcoming me to my post. It is an internal saving or reallocation within his Department, and for some parts of the higher education sector it is a cut in their provision, so it is certainly a saving imposed on them.
	In his letter to David Young, chairman of the Higher Education Funding Council for England, the Secretary of State says:
	"I will write to you again at a later date with full details of the Comprehensive Spending Review...settlement and my strategic priorities."
	The old Department for Education and Skills had its CSR settlement sooner than everybody else, so I wonder why it has taken so long to decide what the strategic priorities are. Of course, that settlement was made before the split and the setting up of the new Department, and I wonder whether this is a casualty of the disaggregation of the old DFES budgets. The change has been rushed through with little consultation. The Department's predecessor has form in that area, given that it announced, without any consultation at all with the higher education sector, that it was going to give foundation degree-awarding powers to colleges. It announced the decision and let everyone else sort out the details and deal with the implications. Once again, the higher education sector feels bounced. This decision will hurt its institutions financially, as well as individual students, some of whom will surely now decide that they are not going to go on to do an equivalent or lower qualification. That will undermine the Leitch agenda that the Government say that they are trying to achieve.
	I understand that some Labour MPs will have probably been getting some hostile correspondence, particularly if they represent relevant university seats, and I know that they have been given some helpful internal Labour party advice, which has also, rather helpfully, been given to me. I have the parliamentary Labour party briefing that has been circulated to help Labour Members to rebut the points that have been made by Liberal Democrats and Conservatives. If you do not mind, Mr. Deputy Speaker, I will quote from it—even though it says that I might be committing an offence by doing so, I believe that I am protected while I do it in this Chamber. There are some choice quotes.  [ Interruption. ] I notice that the hon. Member for Milton Keynes, South-West (Dr. Starkey) is laughing; an institution based in her constituency is raising this concern with her and with all hon. Members, so I do not think that it is an amusing matter. The tone of the briefing suggests that this is all a fuss about nothing. It says that
	"the £100m is less than a third of the total funding of £327m that is currently spent on ELQ students."
	It is less than a third—it is 31 per cent., so it is still a pretty significant amount of money. It says:
	"Those with first degrees do not have to study at an equivalent or lower level than they already have. They can study for a masters".
	Surely that is missing the whole point. Students should be free to make their own decisions on what is necessary for them to increase their employability in the labour market, and if they need to study for an equivalent level qualification or for a lower level qualification, that is the choice that they should make and the choice that the higher education market should offer to them. It seems ludicrous to say that they could go away and study for a masters.
	On the Open university, Labour Members are told to tell us that
	"it is important not to overstate the financial impact—some public comment has done so."
	I know who I would rather believe—the Open university. It also says that the Open university would get a share of the £100 million that has been reallocated within the DIUS budget
	"if it recruits new students (which we strongly believe it can)."
	The Open university has told us that it thinks that these proposals will undermine its existing course provision rather than enhance its ability to recruit new students. The briefing goes on to say:
	"The OU had a £350m turnover in 2005-06 and has generated surpluses to top up its reserves."
	The implication is that that is okay then—it can afford to take a financial hit. That is rather like the Secretary of State's colleague in the new Department for Children, Schools and Families hovering like a magpie over schools' balances; the same attitude is being taken here.
	There are just two more quotes to go. The first is:
	"Some people are asking us why we ever gave money to people on ELQs over those who didn't have a degree at all."
	This is the real gem:
	"The government has made a strategic decision...HEFCE is consulting on the implementation of the policy...We can't consult on consulting."
	That attitude shows total contempt for universities, which are feeling bounced into this and that they have to deal with the implementation of the consequence of a decision that has already been made. The briefing was of course was a private document that was not meant to be circulated, but I am glad that somebody helpfully circulated it to me.
	What is in the public domain is the guidance for students who are contemplating an ELQ course, or have, in many cases, already applied. The DIUS website offers this advice for new students:
	"prospective new entrants in 2008/09 studying courses at the same or lower level should contact the institutions at which they are interested in studying in a few weeks time to see what the position is."
	That is hardly helpful advice for somebody who is taking a fundamental decision. It goes on to say:
	"We recognise that these changes may mean that institutions increase their tuition fees for Second Degrees, although they are not obliged to do so."
	How on earth are institutions going to make up for pretty drastic cuts, in some cases, in their core teaching grant if they do not increase fees? The website goes on to give the justification for this reallocation of funding, saying that £100,000 in public support is given to somebody who has progressed all the way to a second degree-level qualification, as compared to £55,000 of support to somebody who leaves school at 16. Surely that is not the right comparison to offer in public. I thought that the whole point of this was to reallocate money from people who want to pursue a second degree to people who might want to pursue a first degree.

Phyllis Starkey: Obviously not, but that is a curious question to ask because I could throw it back by asking why an employer would not co-fund an employee's training if that training was going to benefit the employer  [Interruption.] I will get on to the point about people moving employer. In many cases, rather than looking to recruit more highly trained people from outside the business, an employer could be thinking of, so to speak, growing their own expertise by retraining individuals they already employ at a much lower level. That is perfectly reasonable.

Hywel Francis: As ever, it is a particular pleasure to follow the hon. Member for Harrogate and Knaresborough (Mr. Willis). He has always been a champion of adult learners, and I welcome the inquiry that his Select Committee is conducting.
	At the outset, I should declare the interests that reveal my enthusiasm for adult learning. I am an honorary life member of the National Institute of Adult Continuing Education, and I am also a vice-president of Carers UK. I want to say something later about the relationship between carers and adult learners.
	I welcome the debate because it offers another opportunity for the Government to showcase their achievements in higher education and lifelong learning, especially when it comes to widening, deepening and increasing participation. It also gives us an opportunity to remind the House about the Government's commitment to implement the Leitch report. However, I am one of those who counsels caution in respect of the proposal to withdraw funding for ELQ students, and I am among the signatories of early-day motion 317.
	I wish to put it on record that, of course, I endorse the Government's contention that there needs to be a reprioritisation of resources so that access and participation can be widened and rendered more equitable, and so that quality can be maintained. However, I worry about the unintended consequences of the proposal. We have heard about them already this evening, and they have been described eloquently by the Open university, Birkbeck college, NIACE and the think-tank, Million Plus. The consequences have also been set out by the CBI director general, Richard Lambert, who has been quoted several times in the debate.
	I tend to agree with those critics who worry that the proposals will distort—clearly unintentionally—the Leitch agenda. They have noted that there are risks that the proposals will destabilise the part-time HE sector, have an unequal impact on certain institutions and disproportionately affect certain adult learners. It is that final risk about which I want to speak now, especially as it relates to carers.
	As chairman of the all-party carers group I take a particular interest in the circumstances of carers, and my Carers (Equal Opportunities) Act 2004 made special provision to ensure that carers were encouraged to pursue lifelong learning. What will happen when a carer happens to be a graduate and is unable to upskill after years, sometimes decades, of enforced caring?
	I come to this debate as a strong supporter of my Government, but one who is an enthusiastic supporter of Birkbeck, the Open university and all adult part-time learners. My right hon. Friend the Secretary of State has rightly acknowledged tonight that such admirable institutions need time to adjust to the changing challenges of our time and to ensure that we have a more radical and enabling higher education system. The House should welcome that commitment as a genuine gesture of support and of his willingness to await the results of the HEFCE inquiry. I urge him to go further and allow even more time for change to take place and to consider the suggestions made by the OU and Birkbeck, particularly that the proposals should be withdrawn or at least that the money saved should be reinvested specifically in institutions that support the skills development of mature part-time learners.
	May I finally urge the Secretary of State to consider consulting education Ministers in the devolved institutions, who are clearly committed to widening participation, as we are here in England, but who do not appear to be going down this road? I urge my right hon. Friend seriously to consider consulting HE Ministers to strengthen wider participation rather than weaken it.

Boris Johnson: When it was my privilege to help shadow the Minister for Lifelong Learning, Further and Higher Education, I had the pleasure of giving the founders day address at Birkbeck college. I also saw a great deal of the wonderful work done in universities across London. It is also one of the most important jobs of the Mayor of London to speak up for education in London and to use all his powers to defend London universities and entrench the position of London as the knowledge centre of Europe and make sure that we continue to have a constellation of first-class institutions that continue to attract huge numbers of foreign students from across the world and contribute healthily to the £1.5 billion in fees that are so vital to the higher education economy of this country.
	At the risk of being partisan, I think it is incredible that the current Mayor of London has said nothing about this issue or about cuts that profoundly affect higher education in this city. I do not wish to do him a disservice; I have not heard him say anything about the issue in the past few weeks. Thousands of people come to London to start their lives afresh and often a major part of that reinvention is a process of re-education and acquiring new skills. That is why there are so many institutions in London of which the bread-and-butter work is to teach those who already hold a qualification at an equivalent or higher level. They include City of Westminster college, Birkbeck, South Thames college, the Conservatoire for Dance and Drama, London Business School, Open university, the Institute of Cancer Research, the School of Pharmacy, the London School of Hygiene and Tropical Medicine, City university, Thames Valley university, Lewisham college, the University of East London and London Metropolitan university. Many of these institutions will have to rethink radically their provision in order to survive. Nine out of 10 of the most seriously affected higher education institutions are in London and 54 per cent. of students taking equivalent or lower qualifications are in London. This move is seriously regressive for London. It is injurious to the interests of thousands of potential learners across the city. As my hon. Friend the Member for Havant (Mr. Willetts) has said, it is particularly damaging to women who wish to acquire further qualifications after a change of career. It frustrates opportunity, stifles aspiration, and sends a negative message to those thinking of pursuing higher education in London. It does nothing to help our status as the centre of the global knowledge economy.
	As was pointed out by my hon. Friends, and by the hon. Member for Bristol, West (Stephen Williams), who speaks for the Liberal Democrats, the cuts are completely antithetical to the Leitch agenda and the Government's previous gospel on the subject. Last September, at the Universities UK conference, the Secretary of State gave a speech underlining the need for universities to offer flexible part-time provision, in order to help hit the target of 40 per cent. of the work force holding an HE-level qualification by 2020. Many London institutions are uniquely placed to deliver that.
	Birkbeck has specialised in the high-quality, research-led teaching of working people since 1823. In 2007, it broke all records for its recruitment, and it was praised by its students for the third year running for delivering an exceptional, high-quality education. As a result of the flexible style of its provision, a third of Birkbeck's students are equivalent or lower qualification students, yet under the new measure they will pay for that. It is estimated that 6,000 or 7,000 people will be affected. The Government's cuts will directly limit the potential of a great institution, and the potential of thousands of students to change their lives. London is disproportionately affected by the cuts. I urge the Secretary of State to rethink this arbitrary decision, and to instead incorporate the proposal in the wider review of fees expected in 2009, as my hon. Friend the Member for Havant and Members of all parties have argued.
	I think it incredible that we will allow Scottish MPs to vote on cutting higher education funding for English students in a manner that will not apply in Scotland. It is an infamous measure, and in all conscience they should abstain from voting on it. It threatens to discriminate against the very people whom we are trying to help.